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Manawatu Standard
May 18 2006

Lake Alice complex up for sale
by Anna Wallis

The former Lake Alice "house of horrors" psychiatric hospital is up for sale - including a water tower and secure prison unit.

The Government is to sell the 56ha complex near Marton by tender next month.

The property, in four titles, will be sold as one lot. It has a ratable value of $1.38 million.

The buyer of the property will get 15 two-storey "villas", two swimming pools, an orchard and glasshouses, several kilometres of roads, a workshop, fire station, sewerage plant and a maximum security prison unit with its own exercise yard. It also has the lake, complete with jetty.

The property comes with a water tower that is a local landmark. Water was previously pumped the six kilometres from the Rangitikei River to a reservoir, then to the tower and reticulated around the complex.

Water rights are secure for the next six years, and one of the titles includes the pumphouse and land at the river.

Real estate company PGG Wrightson says the property could be used for farming, subdivision, a factory site or a retreat. The property is five kilometres from Bulls and seven kilometres from Marton.

PGG Wrightson will hold three open days at the property and will sell the land and buildings by tender. Bids due by June 28.

Lake Alice Hospital was built in 1950 and served as both a psychiatric hospital and, for some time, as the country's only secure unit for the criminally insane.

The hospital was closed in September 1995 during the move to have psychiatric patients cared for in the community in smaller residential units.

It was given a "house of horrors" label in the press after reports of electric-shock treatment and injections of the drug paraldehyde being used as punishment on patients as young as 10.

Paraldehyde causes extreme localised pain.

The national security unit was closed in November 1999, and patients were shifted to the Mason Clinic in Auckland and other secure centres.

The land is currently leased to a local farmer, and the army has used the complex for training exercises.

Thirty staff houses were moved off the property after Lake Alice closed, but all other buildings have been kept on the site.

Many have been vandalised, as the complex has been a popular Halloween destination for those who want to antagonise the ghosts. As recently as this week, people have been caught removing building materials, such as copper, from the site.

Real estate agent Murray Robinson said four companies bid for the right to sell the property, and that PGG Wrightson was the winner.

"We've gone into this with our eyes wide open. We know it's a bit different. Some people might run a mile, but we think it's a fantastic opportunity for someone.

"Just imagine living in the water tower. And what farmer wouldn't want miles of paved roads on their farm? Or it could make a backpackers' (hostel)."

Though the complex is being sold as one unit, the four titles meant it could be split up at a later date by a developer.

He said there has already been plenty of interest from local farmers wanting to buy the land. The company plans to market the property both in New Zealand and overseas to hook a buyer.

Crown Health Financing Agency (CHFA) chief executive Graeme Bell said the people of Wanganui will benefit from the sale of the region's former psychiatric hospital.

"Our agreement with the Whanganui District Health Board means that the money from the sale, minus any selling expenses, will be returned to the DHB for the benefit of the people of Wanganui."

Mr Bell said the CHFA bought the property from the DHB in March 2004.

"This property is right in the middle of some of New Zealand's most productive and desirable farm land.

"It has its own lake, landmark concrete water tower and a water easement from the Rangitikei River, all of which lend themselves to other uses," he said.

"I'm sure there will be significant interest in the property and that we will realise its full market value."